Private dinning with Rory O’Hagan, CEO of Chas Everitt which is a residential property business discussed reversible emigration, property and luxury trends in South Africa. It took place on the 12 April 2023 at The Grillhouse in Sandton, hosted by Kela Securities.

With a background in private wealth banking Rory O’Hagan of Chas Everitt which is the third largest in the country by sales value ( the first being Remax and second Pam Golding ) shared his insight and knowledge on current property trends in the luxury market.

Rory feels that Johannesburg is the Manhattan of Africa and always will be , as we say when Joburg sneezes Cape Town catches a cold and in 2007 and 2008 with the worldwide recession everyone moved back to Johannesburg and the Joburg property market picked up with property not being able to be given away on the Atlantic seaboard.
Property is an emotional investment with a yield plan and capital upside plan.
Johannesburg hasn’t been the best area for property investment for the last 4 to 5 years. There has been a rolling boom in different areas. The most sales to foreign buyers took place in Gauteng during the year of 2022 amounting to 33 200 sales and 16 100 sales to foreign buyers in the Western Cape. There is a perception that everyone is buying in the Western Cape and its not the case.

Only 16% of sales on the Atlantic seaboard was to Foreigners.
In the luxury space there is reverse semigration and reverse immigration. During lockdown many people in Johannesburg made a decision to exit the city heading for foreign shores or the Western Cape. Now that lockdown is over many of these people have realized that business is still in Gauteng, now more institutionalized companies are asking their employees to return to Gauteng.
The luxury market in Gauteng has been under massive price pressure due to so many people having exited , as an example a house in Sandhurst that was on the market for 35 million sold for 16 million Rand.
Sandhurst / Hyde Park houses are selling 30 to 40 % below what they would have been worth 7 or 8 years ago. Many people are now moving back from The Cape.

Alot of money is also returning to South Africa that left for destinations like the UK where they are experiencing hyper inflation.
Scandinavian and Russians are currently big investors in the South African property market. People are now chasing lifestyle alot more than before.
In Cape Town when the drought took place property prices dropped 30 – 40% . They are starting to slowing increase again.

Blairathol Estate in Johannesburg is in the top 10 suburbs in South Africa for the highest average price, it comes in at 3rd place based on average registrations in 2022.
Chas Everitt is part of the luxury portfolio company that has 565 member companies. These are independently run companies that are all part of a global referral process.
People want either a vertical or horizontal luxury lifestyle . Vertical is like Embassy Towers Sandhurst living and horizontal is the luxury lifestyle estates. Trends are all lifestyle driven currently. Luxury homes now include features like bowling alleys, hair dressing salons, cinemas etc.
Trends have moved away from sectional title, after lockdown people realized they wanted their own gardens and are no longer chasing apartment living.

The Property practitioner’s Association which is government run, regulates heavily in South Africa to curb money laundering. Audits take place once a year for FICA , online listing etc.
The greylisting has affected the way a property is marketed and sold in South Africa. Alot more checks are now in place. March 2023 was a record month for sales in Gauteng with the highest amount being sold in 43 years in Chas Everitt. Average price is currently 2.8 million Rand a unit.
Johannesburg is offering unbelievable value at the moment. There will always a spot in the market for houses ranging between 2 to 3 million Rand , what is referred to as a ” sweet spot “.
The rental market is starting to pick up again. In areas where there has been a drive in lifestyle there are now waiting lists for rentals.

Rory is very pro Johannesburg and it’s future. The KZN Northcoast is picking up again past Umhlanga area. Investors can’t go wrong with Zimbali, its recommended in a heartbeat. After the opening of King Shaka Airport the North Coast thrived but sadly the South Coast depreciated. Banks don’t want to reposess property’s, they run distress panels and try to find solutions. Auctioning of properties doesn’t work in South Africa , unlike Australia when 70% are auctioned and sellers get decent prices. The stigma of the four ” D’s” in South Africa being death, divorce , distress and departure , gives the perception you are suffering from one of the four if you auction.
It takes on average 2 to 3 months to sell a house in The Parks. Estates vary based on levies and where they are located.

Overall the property market in Johannesburg is improving with Lifestyle living being the appeal.

By Marion Kate